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You’ve probably heard of Starbucks Rewards, Nectar, Tesco Club and many, many others. The idea of a loyalty program is widely used within the retail industry to drive the strategy behind customer retention.

For those of you still waiting to take the plunge and implement one, what does a loyalty program really entail and why is it so important for your brand?

The main objectives of loyalty programs

The content you curate to drive the messages above needs to focus on growing the profitability of your customers. Ask yourself and your customers what drives them to purchase from you: is it the service? The quality of your products? The word-of-mouth associated with your brand? Your authority and credibility in the industry? Price? Then make sure to build those success factors into your messaging and the way you develop your loyalty program, just like some of the brands below.

krispy creme loyalty

T2 welcome loyalty

Important things to consider when building your loyalty program

If you can answer all these things upfront before designing the nitty gritty of the program, you will be on to a winning strategy. The brands below have some great examples of loyalty programs:

debenhams loyalty

accor hotels loyalty

Using marketing automation to create loyalty programs

The bonus of having done all this work beforehand is that you will most likely come out with a step-by-step program for your particular loyalty objective. Let’s say you want to retain your most profitable customers.

To get started, filter your contacts based on your own RFM (Recency, Frequency and Monetary) model. This will help you find your highest spending customers cross-analysed with when they last purchased and how much they spent in one transaction. Use this set of data to create levels of segmented groups with the objective of making good customers EVEN better.

Then create a targeted automation program focusing on a product range from which they had purchased before with a view to understanding their purchasing behaviour for the future. Focus the content and copy of the emails on how much you value their custom and that you want to get to know them. Launch the program, evaluate and iterate. It won’t bring you the best results the moment it first runs, but if you keep testing and improving, it can bring you a fantastic return on investment.

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